Despite some hurdles in the past, blockchain has emerged as a growing force driving African economies. In fact, according to a new report released by CV VC, the private blockchain venture capital firm, and Absa Group, the pan-African bank, blockchain accounts for 6.4 per cent of Africa’s total venture funding, surpassing the global average of 3.5 per cent.
The third iteration of the report, titled African Blockchain Report, reveals that despite global economic pressures, African blockchain funding is expanding in large parts due to regulatory advancements. It also found blockchain is having an impact on transparency, sustainability, data accountability, new service and creator economies, and financial inclusion across the region.
Leaders in the industry, including Mathias Ruch, CEO of CV VC, and Rob Downes, head of digital assets, CIB Africa, Absa Group, emphasise blockchain’s transformative potential in Africa’s socioeconomic systems and financial sector. They foresee continued growth as regulations clarify and awareness of blockchain’s benefits expands.
Ruch said “Africa’s vast natural asset, its people, coupled with the growing recognition of Africans’ technological ability, resilience, and spirit, positions blockchain as a pivotal tool to support socio-economic advancement, not just for Africa but as a solution to many of the ill winds blowing globally.”
Downes added “ We expect to see blockchain-enabled use cases grow as regulations become clearer and awareness of the benefits grows among our customer base. The regulatory landscape is critical to our expanded participation, and there’s a great overview of it in this report, which we are very proud to co-publish with CV VC.”
Highlights
The report presents all venture funding from a global perspective with a lens on Africa. In doing so it highlights African investment trends, showing a shift towards DeFi (decentralised finance) and data management, verification and analytics in H1 2024, reflecting growing investor confidence in foundational blockchain technologies and financial solutions.
Insights by NODO, the report’s regulatory research partner, show that previously, crypto was implicitly banned in 36 countries, now reduced to 8 indicating evolving stances.
CV VC and Absa Group highlight Africa’s rising prominence in the global venture ecosystem, reaching an all-time high of 0.62 per cent of all global venture deals. The report also shows that despite a 64 per cent global decline in blockchain funding in 2023, the first half of 2024 showed a more moderate nine per cent year-over-year decrease, signalling potential recovery.
Furthermore, in the first half of 2024, blockchain accounted for 6.4 per cent of Africa’s total venture funding and 12.5 per cent of all deals. This surpassed the global averages of 3.5 per cent and 5.9 per cent, respectively.
From a deals standpoint, African blockchain ventures also began to rebound. In 2023, $135.4million was raised from 17 deals, and $34.7million from 12 deals in the first half of 2024. This marks a nine per cent increase in deal volume from the previous year’s first half.
